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Can I reclaim my home after foreclosure?

On Behalf of | Aug 28, 2018 | Real Estate |

Homeownership has long been viewed as a pillar of American independence and a benchmark of upward mobility, but the realities of owning a home are often far more complicated than homeowners realize when they finalize their purchase.

Life is full of hidden twists and turns, and a streak of bad luck or a large-scale downturn in the local or national economy may mean that a homeowner simply cannot make their mortgage payments. If the homeowner cannot get back on track with their payments quickly, then the bank will probably foreclose on the home.

Over the last decade since the housing crisis of 2008, foreclosure has broken the dreams of many homeowners, but not all homeowners are willing to walk away from a property they value highly. To those who are not satisfied to move on from foreclosure and wish to keep fighting to regain their home even after foreclosure, the law does allow some wiggle room.

Many homeowners are unaware of the “right of redemption” in real estate law, which creates an opportunity for homeowners who have lost their homes to potentially regain them, even after some other party purchases the property.

What is the right of redemption?

The right of redemption allows a homeowner who has already lost a property to foreclosure to reclaim the property. This is not an easy or simple process, but if an individual is highly motivated, it is possible.

In broad strokes, the law allows the former owner of a foreclosed property to reclaim the property if they can pay the amount that the property sold for at a foreclosure sale. In addition to this, the former owner must pay a statutory rate of interest to the party that purchased the property, as well as some other potential charges.

While the time period shifts from state to state, a homeowner generally has a small but useful window of time to formally request that the buyer provide a list of the individual charges the former owner must pay in order to reclaim the property. This window of time may change depending on the state where the foreclosure occurs as well as some other factors, but it is typically about a year from the date of foreclosure.

In contrast, the party that purchased the foreclosed property is only granted a small window of time to respond with an itemized list of charges, such as 10 days.

If the former owner of the property can deliver the full payment for the foreclosure sale price of the home and several other expenses within the allotted window of time, then they may successfully reclaim the property. While this is no small feat, it is an opportunity that many foreclosed homeowners may wish to consider.

Protect your rights with a clear strategy

Successfully reclaiming a foreclosed property is a difficult task, but one that is ultimately rewarding. If you believe that you may have an opportunity to reclaim your foreclosed property, make sure to use excellent legal resources while building your strategy. Clear understanding of the many legal issues at hand can help you navigate this difficult season and keep your rights secure while you fight to reclaim the home that you value.


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